GOP Flirts With Clinton Veto

Senate Majority Leader Trent Lott is proposing legislation -- at an estimated cost of $33 billion dollars over ten years -- that would extend several expiring credits through 2001. The bill would make the business research and development credit permanent.

The credit, which expired on June 30th, is prized by the high-tech industry and manufacturers.

But the measure puts Lott at odds with the Senate's chief tax writer, Finance Committee Chairman William Roth, R-Del.

In all but its first year, the bill would spend some of the projected non-Social Security budget surplus. President Clinton has threatened to veto the five-year, $23.2 billion House version for the same reason.

Roth believes his version has a better chance of succeeding. The $8.5 billion Finance Committee measure is fully paid for.

While the tax proposal presents one potential Capitol Hill showdown, CBS White House Correspondent Mark Knoller reports that Mr. Clinton and congressional leaders are still battling over the budget for other legislation.

Out of 15 bills, the president and Congress have signed off on seven, the president has vetoed two, and they're fighting over the remaining six.

Meanwhile, House Republicans also are proposing a 1.4 percent across-the-board cut in federal spending that would affect all government operations except Social Security, Medicare and other benefits -- and lawmakers' own salaries.

Amid their budget fight with President Clinton, top House GOP lawmakers laid out the proposal Friday as part of their effort to keep overdue spending bills from dipping into Social Security surpluses. They said the plan would save $4.5 billion by ordering agency directors to ferret out waste, fraud and abuse.

"It's no drastic cut," said House Majority Whip Tom DeLay, R-Texas.

Mr. Clinton has said he would veto an across-the-board reduction. The administration said the cuts could force layoffs of 39,000 military personnel and the denial of food, education and other aid to thousands of Americans.